The Blog

Amidst the COVID-19 pandemic, there have been a slew of unprecedented measures passed over the last several months in an effort to help those that have lost employment during this crisis.  There are many opinions regarding these measures and their effects on both tenants and homeowners/landlords alike.  What are the unintended effects of the measures that our legislators and leaders have passed both statewide and nationally?


The law of unintended consequences, a common topic among economists and social scientists, states that actions (most particularly by the government) always have unanticipated or unintended consequences.  Make no mistake about it, this is not a post to discuss partisanship.  Partisanship is futile in a scenario such as the COVID-19 pandemic, a historical crisis that put our economy and the health of the entire world in a tight rope balancing act.  No “perfect” decisions could be made, and there would inevitably be some form of unintended consequences in either direction regardless of which party or politician made them.


Two very well known pieces of legislation/executive actions that were enacted for COVID-19 relief are mortgage forbearance and a moratorium on all rent.  There are unintended consequences to both sides of these coins.  Unfortunately, there will always be humans that take advantage of the system.  Even if it is to the detriment of the greater community, economy, and our nation.  I had a client tell me yesterday that the house which she is living in has gone into pre-foreclosure, even though rents are being paid on time.  This is something that could happen in any economic climate, of course.  But there are going to be additional homeowners and landlords that think they can stop paying and take advantage during a time of national crisis.


Similarly, there are tenants that have stopped paying rent even though they are still employed.  The rent moratorium in Connecticut has been in place for months and is looking like it will be going straight into the winter, at which point people will still not be able to be evicted until the Spring!  We are looking at a scenario where some tenants will ultimately end up living for free for a full year.  We could see the same behavior with homeowners/landlords not paying their mortgage even though they are employed and/or collecting rent.


What is the point of discussing this?  We all know that there are bad apples out there, right?  While it seems like a “no brainer” that these types of actions have incredibly negative effects, there are also many people out there that truly do not understand the implications of these behaviors.  If you are a landlord/homeowner, know that forbearance does not equal forgiveness.  Your missed payments WILL have to be paid and accounted for.  In order to truly set yourself up for long term success, do not be tempted into thinking that this is an opportunity to get a “leg up”.  Kicking the can down the road will ultimately create many more problems for both you personally and our nation’s economy.  Without a healthy economy, prosperity will falter.


If you are a tenant with the ability to continue paying your rent, do the right thing!  There are countless small landlords out there that rely on their rental income to pay that property’s mortgage.  Just because you cannot be evicted right now does not mean you won’t be able to down the road.  An eviction on your record can be detrimental to finding housing in the future.  Just like a homeowner, or your landlord, neglecting to pay their mortgage, failure to pay rent will only make our nation’s fight for recovery more difficult.


This is a time when everyone needs to come together for the common good and lift one another up.  Let’s all put one another, and most importantly ourselves, in the best position to succeed despite the adversity we are facing.



Be Great,


Thomas Cody, Realtor, C-REPS




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